Saturday, 

Regulators Clear Armenian Telecom Giant’s Sale

        • Marine Khachatrian
        • Sargis Harutyunyan

Russia -- A man walks past the company logo in the head office of Beeline, a 
brand owned by telecoms group Vimpelcom, in Moscow, August 7, 2013

State regulators have allowed the Amsterdam-based telecommunications company 
VEON to sell Armenia’s oldest fixed-line and mobile phone networks to a recently 
established Armenian firm.

VEON asked two Armenian regulatory bodies to clear the sale in early June one 
month after pulling the plug on the planned takeover of its Armenian subsidiary 
by one of its two local rivals, Ucom. The latter is also the country’s largest 
cable TV and Internet service provider.

Ucom was on course to buy VEON until being thrown into turmoil in April 
following the sncdalous resignation of its chief executive, Hayk Yesayan, and 
his deputy and brother Aleksandr. The brothers, who hold a nearly 6 percent 
stake in Ucom, tried unsuccessfully to buy the rest of the company controlled by 
the extended family of Gagik Khachatrian, a former finance minister arrested 
last August on corruption charges denied by him.

Gurgen Khachatrian, the ex-minister’s son heading Ucom’s board of directors, 
claimed later in April that the Armenian authorities are illegally trying to 
force the family to sell its controlling stake at a cutdown price. Khachatrian 
went into hiding in early May shortly after the National Security Service 
brought new criminal charges against him. He strongly denied them.


Armenia -- Gurgen Khachatrian, the chairman of Ucom company's board of directors.

A few days later, VEON informed anti-trust regulators that it is pulling out of 
the planned deal with Ucom. The telecom company went on to reach a similar deal 
with the Yerevan-based tech firm Team set up by the Yesayan brothers.

The two entities asked the State Commission on the Protection of Economic 
Competitition (SCPEC) and the Public Services Regulatory Commission (PSRC) to 
clear VEON Armenia’s sale to Team. Both regulatory bodies approved the deal in 
separate decisions made on Thursday and Friday respectively.

“I think that we will bring the deal to an easy conclusion very soon,” Hayk 
Yesayan told RFE/RL’s Armenian service. He again refused to reveal how much his 
newly created company will pay for VEON Armenia, formerly called ArmenTel.

VEON paid $376 million to buy ArmenTel from a Greek firm in 2006. The company 
was headquartered in Moscow and known as VimpelCom at the time. Russian 
billionaire Mikhail Fridman’s LetterOne fund remains VEON’s largest shareholder.

VEON’s Beeline mobile phone network has the second largest number of subscribers 
in Armenia after the VivaCell network owned by Russia’s MTS operator. VEON 
Armenia is also a major Internet service provider.


Armenia -- Hayk Yesayan speaks to RFE/RL, July 7, 2020

The anti-trust regulators’ approval of the proposed acquisition was conditional 
on Team pledging not to lay off more than 10 percent of VEON Armenia employees 
for at least six months. Many of those employees are reportedly worried about 
losing their jobs as a result of the takeover. Some of them protested outside 
the PSRC offices in Yerevan on Friday.

Yesayan insisted that the new owners are not planning staff cuts or other 
layoffs. “We need them,” he said, referring to the telecom operator’s current 
workforce.

The regulators gave the green light for the deal despite strong objections 
voiced by the Ucom management. In a statement issued earlier this week, the 
company said that for almost a year the Yesayan brothers had negotiated with 
VEON in their capacity as top Ucom executives and exploited that experience to 
negotiate a similar deal for their new company in a matter of weeks. It claimed 
that this amounted to unfair competition.

Yesayan shrugged off the Ucom objections when he spoke to RFE/RL’s Armenian 
service on Tuesday. He also said he and his brother have yet to decide whether 
to sell their minority stake in Ucom.


Reprinted on ANN/Armenian News with permission from RFE/RL
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